NXP Semiconductors and Datang Telecom to Establish First True Chinese Automotive Semiconductor Company
Joint Venture takes Leadership Position in Chinese fast-growing automotive market
Eindhoven, Netherlands and Beijing, China, December 2, 2013 - NXP Semiconductors N.V. (NASDAQ: NXPI) and DATANG TELECOM TECHNOLOGY CO., LTD (SSE:600198) today announced the establishment of a joint venture (JV), the first true automotive semiconductor company in China. The JV will focus on developing and marketing semiconductor solutions for the domestic hybrid and electric car market, a top priority in the latest five-year plan of the Chinese government. Teaming up in this JV are two strong industry partners: NXP is the largest automotive semiconductors supplier for China (source: Strategy Analytics, April 2013), while DATANG TELECOM is a state-owned multinational high-tech enterprise headquartered in Beijing, China. The JV is subject to relevant Chinese authorities’ approval.
The new company – Datang NXP Semiconductors Co., Ltd. - will be headquartered in Nantong, China, close to Shanghai. It will be a fabless company that primarily serves the domestic Chinese market, focusing on the research, development and sale of advanced application specific automotive ICs in High Performance Mixed Signal technology. NXP will transfer and license certain intellectual property rights to the JV, specifically in power management including battery management. NXP will hold a 49% share in the JV, with Datang Telecom representing 51%. The JV will strengthen the ties of NXP and Datang Telecom with political decision makers and emerging local customers and partners. Kurt Sievers, executive vice president and general manager of the automotive business at NXP Semiconductors, explains: “China continues to be the fastest growing automotive market in the world where NXP holds already today the number one position*. This Joint Venture offers outstanding opportunities for NXP to further accelerate our business growth. : We will greatly benefit from Datang Telecom’s government and industry networks in China. The JV will focus on new energy vehicle technologies, one of the top priorities in China’s five-year government plan and a perfect complement to NXP’s portfolio of semiconductor solutions for the smart connected car. Altogether, Datang NXP Semiconductors ideally combines the expertise of both companies to provide high-quality, competitive products that perfectly match the emerging needs of the Chinese automotive industry.” "Driven by strong government support, new energy technologies for the hybrid and electric car market industries in China are set to achieve strong growth. Design of integrated circuits is one of the company’s core businesses. With this investment we can now reach into the growing automotive semiconductor market in China and offer customers premier products and services through enhanced design capability”, commented Mr. Cao Bin, President of Datang Telecom Technology CO., Ltd.